Webinar: Proven Strategies to Close the 18-Day DSO Gap

Here’s a reality check for finance leaders: You’re being asked to do more with less — way less.

In our recent webinar, “Close the 18-Day DSO Gap: Proven Strategies to Optimize Cash Flow,” Billtrust sat down with experts from The Hackett Group to tackle the issues that keep CFOs up at night. As Bryan DeGraw, Associate Principal at The Hackett Group, pointed out, workloads are climbing while budgets tighten and teams shrink. But not all are struggling. Studies show top performers collect on their overdue invoices 18 days faster than median organizations (28 days vs. 46 days DSO). So, this got us thinking: How do the top performers achieve this and how can others follow suit?

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Key Learnings from the Hackett Group

• $600 billion is trapped in accounts receivable (AR) across the largest 1,000 U.S. companies, a 54% increase since 2018
• Collections efficiency isn’t about volume, but rather implementing debtor segmentation strategies that enable proactive engagement
• According to Hackett’s research, AI in AR delivers measurable results: 67% reduction in process costs per collection contact and 43% improvement in cash flow predictability

Let’s unpack more of Hackett’s collections best practices.

The #1 Priority for CFOs Now: Optimizing Working Capital

Citing The Hackett Group’s data, DeGraw noted that in 2025, finance workloads are projected to jump 4.1% while FTEs and budgets are expected to drop 0.8%. That’s nearly a 5% efficiency gap your team needs to bridge somehow. This pressure is why finance leaders have decisively shifted their priorities, focusing on financial liquidity now more than ever before.

Working capital optimization has jumped from the #7 priority in 2022-2023 to the #1 priority for 2025, according to the Hackett Group.

And we all agree that it’s here to say. “I’m going to take a gamble and say that working capital optimization is going to hold the number one priority for quite some time,” said DeGraw.

The days of throwing people at the problem are over. The winning strategy is collections automation software and intelligent AI technology capable of unlocking the cash sitting on your balance sheet. Organizations recognize that closing the gap between rising workloads and shrinking resources requires investment in the right tools.

Companies have $600 Billion Trapped in Accounts Receivable

Defining the scale of the problem – this is where things get interesting. István Bodó, Senior Director at The Hackett Group, shared data from their 2025 U.S. Working Capital Survey showing that despite years of digital transformation, there is roughly $600 billion trapped in accounts receivable right now. That represents 35% of the total gross working capital opportunity – and it’s grown 54% since 2018, up from $389 billion.

Companies have $600 billion trapped in accounts receivable as of Q4 2025.

The real kicker? This shouldn’t be reality. After all, we already know the winning formula. Top-performing companies that collect 18 days faster than everyone else have already cracked the code.

We just have to learn from them.

Unlocking $600B in AR: How Top Performing Collectors Reduce DSO

In FY2024, upper-quartile performers clocked an average Days Sales Outstanding (DSO) of 28 days. The median? 46 days. That’s a 40% performance gap, and for the average enterprise, closing it could unlock millions in working capital. The question is: which side of that gap are you on?

The best finance teams have stopped thinking of AR as a back-office function. They’ve transformed it into a strategic growth lever. Here’s how they’re doing it.

World-Class AR Operations Focus on 3 Fundamentals

1. Ensuring billing and invoice accuracy
2. Getting paid within the agreed payment terms
3. Processing payments efficiently

Invoice Accuracy and Getting Paid on Time

Accurate invoices — sounds simple, right? But as DeGraw noted, “simple” is a concept that can quickly break down. All it takes is one small error.

For example, one typo on an invoice can start a 30-day dispute and trigger adjacent consequences. If your credit team is blind to disputes, payment terms and credit allocations can be approved for a customer whose payments are already 60 days late.

This situation demonstrates a critical insight from the webinar: Many organizations are unknowingly creating their own Days Sales Outstanding (DSO) problems. When DeGraw’s team digs into contracts and terms during client engagements, they often discover companies are their own worst enemy. Financial decisions are being made without all the information needed to make the smartest call. Extended payment terms might win deals, but they automatically inflate DSO performance metrics, making them a primary root cause.

Leading financial organizations can answer critical questions like: Even with extended terms, are my customers paying on time? Moreover, they have data showing them how payment patterns are changing over time.

Collections Efficiency: Outreach Guided by Strategic Segmentation

Here’s the uncomfortable truth: DSO delays often aren’t about slow-paying customers. They’re about inefficient processes. One telling statistic from the webinar that The Hackett Group shared: Digital world-class organizations achieve 67% lower process costs per collection contact compared to their peers. But that’s not because they’re calling or contacting more debtors — they’re simply calling strategically.

Too many collectors spend their days buried in administrative tasks instead of actually talking to customers. According to Billtrust’s data, the average collector wastes 8-10 minutes per email and can increase their capacity by at least 3.2X through automation. Learn more about it in this guide, Next-Gen Collections: Tips to Get Invoices Paid Faster.

The fix? Proactive segmentation that guides collections outreach type and cadence.

How to Segment Debtors for a More Strategic Approach to Outreach

Reach out before the due date to catch disputes early. Focus your A-team on the 20% of customers who represent 80% of your outstanding debt. Use automation for everyone else.

And here’s the key according to The Hackett Group: Customize your collections approach based on a nine-box segmentation model that plots customers by both payment behavior and sales value:

• High-touch for high-sales, poor payers
• Medium-touch for high-sales, average payers
• Low-touch for low-sales, low-risk customers

The payout can be enormous. Hackett’s research shows tailoring your collections outreach according to financial risk lowers delinquency by 83%, as noted in the image below.

Using AI to Improve Collections Effectiveness

Artificial intelligence is another must-have for top performers focused on collections effectiveness. The impact of AI on AR is impressive, according to a study performed by Wakefield Research:

• 99% of finance leaders using AI reduced their average DSO (75% by at least 6 days)
• 82% measurably improved productivity and scalability, all without adding headcount
• 43% saw improvements in cash flow predictability

During the webinar, attendees were asked how confident they felt about leveraging AI in accounts receivable. The results were split: about 20% felt very confident, but the majority were only somewhat confident or not yet confident. If you’re in that boat, you’re not alone, but you’re also leaving money on the table. Learn more about AI trust.

“With AI, I just see enhancement. I see value added to the work AR is doing as collectors and personal benefits, too — less overtime and less stress.”

Bryan DeGraw, Associate Principal at The Hackett Group

Using AI to Help Collectors Handle the Email Overload

With AR automation features like Agentic Email, Billtrust enables collectors to go from taking 8 minutes to process one collections email to just 2 minutes. That’s thanks to large language models and AI agents drafting client communications with contextual intelligence.

Becky Carr, CMO of Billtrust, further explained, “Not only does the AI act as a virtual assistant, but you’ve also got your whole work list prioritized. And collectors never lose control with the ability to accept and send or modify quickly.”

Explore Billtrust’s collections automation capabilities.

Obsess about Accuracy, Metrics, Compliance

For many organizations, aging receivables and disputed invoices stem from poor data management such as inaccurate orders, billing errors, or unclear payment terms. If you had clean data from the start, you’d likely have minimal collection issues.

This is why digital world-class organizations obsess over the following items:

• Master Data Management: Clean, governed customer data
• Performance Measurement: Knowing where you are with your finance metrics, where you want to be, and track progress regularly
• Policy Compliance: Established, enforced credit and collections policies

Without these foundations, you can’t effectively implement AI or automation. You are essentially building a house on sand, said Degraw.

Your Roadmap to Close the 18-Day DSO Gap

Ready to move from median to top quartile? Here’s your plan in five steps.

1. Benchmark ruthlessly. Know where you stand against top performers and quantify what closing the 18-day gap means in real dollars. The Hackett Group’s annual working capital survey provides industry-specific benchmarks so use them.
2. Start small with AI. Don’t try to transform everything at once. Pick one use case, implement it well, and build from there. Focus on AR areas with the most manual work and biggest bottlenecks. And remember: if you’re already using modern AR software, you’re probably using AI and don’t even know it.
3. Digitize relentlessly. It’s shocking that a lot of B2B payments still happen via check. Eliminate manual invoicing and collections tasks through automation and integrated platforms. With new government regulations and compliance requirements, digital transformation is becoming mandatory.
4. Optimize continuously. This isn’t set-it-and-forget-it. If you’re doing segmentation manually for collections outreach, do it at least twice a year. Better yet, implement technology that handles dynamic segmentation automatically, adjusting in response to changing customer behaviors. See how Billtrust does this.
5. Invest in your people. Technology is only as good as the people using it. Build a formal AI training and adoption program. Address fears and concerns head-on. Make sure your team understands that AI elevates their work rather than replaces them.

It’s Not Magic. Just Give Your Team the Tools to Win.

Top performers aren’t doing anything magical. They’re just being disciplined about process, strategic about technology investment, and relentless about execution. Their tools exist, their roadmap is proven, and their organizations are achieving measurable results. This is all that marks the difference between being “median” and achieving “best-in-class,” as DeGraw highlighted in the webinar. It’s a concrete plan that’s easily repeated.

Get in touch with Billtrust to explore how we can help improve your AR performance.